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Marksans Pharma Ltd
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Good evening, ladies and gentlemen. I'm Kritika, moderator for Marksans Pharma Q2 FY '23 Earnings Conference Call hosted by DAM Capital Advisors Limited. [Operator Instructions] Please note this conference is recorded. I would now like to hand over the floor to Mr. Nitin Agarwal from DAM Capital. Thank you, and over to you, sir.
Thanks, Kritika. Hi. Good evening, everyone, and a very warm welcome to Marksans Pharma's Q2 FY '23 Earnings Call, hosted by DAM Capital Advisors. On the call today, we have representing Marksans management, Mr. Mark Saldanha, Founder, Chairman and Managing Director; and Mr. Jitendra Sharma, Chief Executive Officer. I'll hand over the call to Mark to make your opening comments and we'll open it for questions.
Yes. Hi, Nitin. Thank you, and welcome and thank everyone for joining us on our Q2 FY '23 and H1 FY '23 earnings. I'm pleased to announce that we have had a strong financial performance and a high digit double growth across all the regions in the quarter. Our robust growth comes from regions which were supported with obviously volume growth as well as market share gains in existing products, a strong revenue growth and a focus on cost efficiencies resulted in an improved margin of 17.7% in the quarter.
Moving on to the operational environment. It continues to remain tough with high inflation, supply chain challenges and pricing pressure. We witnessed a high digit -- single-digit price erosion in generic Rx business in the U.S. Our focus remains on sustainable growth. Manufacturing and innovations are a strategic pillar for growth. In October 2022, we acquired a manufacturing facility from Teva, India that has the potential to scale up our manufacturing footprints in India by an additional 8 billion units per annum over the period of next 2 years.
Obviously, this will drive our transformational growth journey moving forward. We plan to produce and manufacture tablets, hard capsules, some gelatin, ointments, creams and liquids from this plant. This plant is in addition to the 3 existing manufacturing facilities in U.K., U.S. as well as in India, which we already have. And this plant is basically spread across 47,597 square meters. It has approvals from EU health authorities, the Health Canada and the Japanese health authorities. We're expecting this transaction to be finalized by April 1, 2023, subject to the usual closing conditions.
In our previous calls, we've always mentioned and we are still moving forward to backward integrate ourselves into API manufacturing on our core molecules for captive consumption. That will potentially have cost synergies and potential gross and EBITDA margin expansion of 500 basis points. Our focus on R&D, our product pipeline -- our focus on R&D still remains with our product pipeline being very strong. We plan to launch several products with high value in the next 2 years. Our R&D expense was 2.1% of the revenue at INR 18.7 crores in H1 FY '23. We further aim to increase R&D spend between 4% to 5% of sales in the coming years.
We are confident that our market share gains and the volume growth in the existing product portfolio supplemented by new molecules will drive our growth journey in the coming quarters and years. We do see a potential growth demand in Rx and OTC and in the segments that we are already existing in various markets, and especially the Rx-to-OTC switch, which obviously is very lucrative.
With this, I'd like to turn it over to Jitendra, who will update you on the financials before we can start our Q&A questions. Jitendra?
Thank you, sir. I will explain the financial performance of Q2 of FY '23. For Q2 of FY '23.
Sorry, sir. Your voice is a bit low.
Sorry. For Q2 of FY '23, our operating revenue was [ INR 452.6 crores ], an increase of 25.5% compared with [ INR 351.2 crores ] last year. U.S. and North America was at INR 190.3 crores, representing a 13.7% increase on a year-on-year basis. EU and U.K. formulation market grew by [ INR 33.35 crores ]. U.K. formulation market recorded 39% growth to INR 43.9 crores. Rest of world [indiscernible] a 56.4% increase in the sales to INR 24.9 crores in Q2 of FY '23.
Gross profit was at [ INR 222 ] up 23.4% year-on-year. Gross margin declined by 80 basis points from 51.4% to 50.7% in Q2 FY '23 due to the pricing pressure. EBITDA was at [ INR 80.3 crores ], an increase of 33.6% Y-o-Y, led by operating leverage. EBITDA margin improved by 110 basis points from 16.6% in Q2 of FY '22 to 17.7% in Q2 of FY '23. Profit after tax was at [ INR 60.1 crores ] in Q2 of FY '23 compared to INR 46.3 crores in Q2 of FY '22, [indiscernible], [ so 9% ].
EPS for the quarter was 1.52, 36.3% growth on Y-o-Y base. So operating revenue for the first half.
Sorry to interrupt you, sir. Your voice is still low. Could you please come closer to the mic?
So the operating revenue was at INR 886 crores in H1 of FY '23, up 24.8% Y-o-Y. The gross profit for the first 6 months of fiscal '23 increased by [ 20.4% ] year-on-year to [ INR 448.3 crores ], gross margin was at [ 51.6% ]. EBITDA for the first 6 months of fiscal '23 was increased by [ 11.4% ] year-on-year to INR 153.1 crores. However, EBITDA margin declined by 210 basis points from 19.4% to 17.3% in H1 of FY '23. This was mainly on account of increase in cost of materials, freight costs.
Excuse me, sir. Jitendra, can you please speak a bit louder because most of them are unable to hear you clearly?
Okay. In the first 6 months of FY '23, PAT grew by 10.5% year-on-year basis to INR 120 crores. The earnings per share grew by 14.1% to INR 3 per share. We spent [ INR 18.7 crores ] in the quarter in the first half of the FY '23 in R&D, which amounts to 2.1% of the sales. We continue to remain debt-free. We had a total of [ INR 3,335 crores ] of cash and bank balance as of 30th September of 2022, which we plan to utilize for CapEx and funding our inordinate growth strategies. With this, I would like to open the floor to question and answers. Thank you very much.
[Operator Instructions] Ladies and gentlemen, please stay connected we reconnect the management.
[Technical Difficulty]
[Operator Instructions] First question comes from Madhu Shashi from Capital Private Limited.
Yes. Sir, my question is regarding the new acquisition that bought we made for the tech. So the acquisition cost is [ INR 200 crores ]. And so worried about that, what would be the expected CapEx amount on this facility?
No. The acquisition cost, basically, the amount we plan to spend, including the acquisition cost and CapEx is INR 200 crores.
Okay. Okay. Okay. And one more, what is our plan for U.S.? Are we going to make it for the U.S. market as well?
Yes. Obviously, we would have to get this plant registered in the U.S., but we do plan to obviously utilize infrastructures for both Europe as well as U.S.
Sir, are we able to use any of the products and get to start getting revenues from this plant?
Pardon, did you say when will we get the revenues or...
No, I'm saying that now this is the business from Teva. So they may be supplying some products on this brand that facility to Teva Pharma.
So yes. So we will be -- we would have a supply arrangement with Teva stand out for the next 12 months after the acquisition is closed. After that, we will be taking a call on extending the supply arrangement, if need to be. But we do plan to also produce our products for various markets.
And sir, will how much -- so can we have -- some from the first year on a [indiscernible] CapEx?
So the CapEx will obviously be within the next 2 years. It's not going to all happen in 1 year because there's a lot of capacity expansion that we have to work on. But we will start -- we will be doing some revenues in the first year itself, which would be supply arrangements with Teva and some of our products that will be producing in that plant.
Okay. And if I do with the last question sir, is there any plan to ship some of the products from the existing facility at Gobal?
Yes. Basically, there will be some products, but we'll have to only move products, which are European approved because that Teva presently has European approvals. So we will be probably leveraging the Teva plant for those products, which are required for U.K. and rest of Europe.
[Operator Instructions] We are having a question from Reva Chagrin from Green Portfolio.
The first question I have is, so we acquired Aktiv Healthcare in June '22. So now in this quarter, we would have the full effect of this Aktiv acquisition. So if you can just give me the breakup of how much revenue that you made from Aktiv in the current quarter?
This is Jitendra here. So the -- see, the ASC relatively is a small business for this quarter 2. We have achieved revenue of around [ AED 5 million ], which will be translated into equivalent of INR 12 crores.
And my next question is, so we are planning the API backward integration project. So -- but in the number and capital working progress, I'm not seeing any update. So if you can just explain a bit about when would this project would start? And what would be the process of this?
So basically, the API, obviously, we plan to file our first DMF because it's a long process. It still needs approval. It still needs to come on to a license. So we plan to basically file our first DMF in the mid of 2023. So I do believe any upside in terms of leveraging of profitability will happen only towards the end 2023 -- '23, '24, potentially.
So once we start making the DMF, are you planning to sell it to the outside market or only use...
No, it's only for captive consumption.
So my next question is, in the balance sheet I'm looking at, the goodwill has grown from 300 million to 476 million. If you can get some explanation on why we have grown the goodwill.
This goodwill was on account of acquisition of Aktiv Healthcare. So around INR 17 crore has gone into goodwill. The purchase price allocation of what consideration we have paid for the acquisition of the company.
So my last question is, so in the accounts, we have around INR 18 crores as restricted cash balance. So what is the use of this money?
Basically, this restricted cash of INR 18 crores is into escrow account, which we have kept towards the buyback of shares. The buyback program is going on right now. And as per the SEBI requirement, we have kept [ 25% ] of the overall buyback budget into the escrow account.
[Operator Instructions] There are questions from Nitin Agarwal from DAM Capital.
Mark, on the U.S. business, while you're ramping up your filings, what is the kind of filing target that we have in mind over the next couple of years?
We have very close to 30-odd products that we are working on right now, and we are expecting, as a matter of fact, approvals every year. And probably every half yearly, we will see approvals coming in 2023. I think '23 we'll probably see about 5 ANDAs getting approved. And then on an average, maybe [ 7, 8 ] products approval per year. So we have -- we are targeting about 30-odd products for the U.S. market.
And in terms of composition of these products, what will be split between OTC and Rx products and the approvals that you're expecting?
Yes. So obviously, it will be about probably maybe 65%, 70% will be in OTC and the balance will be in Rx.
Okay. And secondly, on that account, on the current portfolio that you're marketing, I think where do we see -- I mean, in your assessment, how much of the incremental sales potential that we have in the current set of portfolio of deals?
Well, obviously, it's just the tip of the iceberg. We have not penetrated anything significantly, but we are still doing decent numbers. I do see next year, our growth drives happening from the U.S. because we have been awarded items and we do plan to commercialize by March of 2023. So we do see a much more healthier road map for next financial year. And with this, our market share will slowly start growing. I think we -- so we have a tremendous growth potential in terms of market penetration, market share on the existing product portfolio. Obviously, the new products will just be the icing on the top.
Look, on the -- we've seen a fair amount of disruption which has happened on the generic side of the descriptor side of the business in the U.S. There have been a lot of questions around the price erosion, which has happened. How has been the business on the OTC side, the market environment with the OTC side? Has the pressure been had severe as the OTC business?
Well, the OTC, in terms of pricing pressure was not as bad because OTC is more on private label, more on -- it's a much more sustainable business model. But there was obviously profit margins because of cost of inputs going up and freight going up, everything of that stuff going up. So obviously, the advantage of the OTC is while you have better visibility, you have a sustainable business model, you have contracts for a longer duration. The minus, the negative side is you are stuck with the contract and you got to honor it and if you're costing or pricing or other intangible cost goes up because of various issues, it does have an impact on the bottom line. But that said and done, now we see the freight costs coming down. We see a lot of raw material pricing being eased. So we do see a better profitability being generated and revenue growth is anyhow quite stable and moving in a positive action where OTC is concerned.
Last one on that, Mark, on -- so when you are typically competing for these bids with these retailers in the U.S. or with the customers in the U.S., I mean what is the typical nature of competition that you have to contend with or how many typical players and other players in India? Because typically, on the generics side, prescription side as where essentially bulk of the problem from industry essentially originated from.
So obviously, the players are -- you have all the big guys out there. Most of the big guys have entered into the foray for OTC. So in terms of the largest player, you're obviously at Perrigo. But beyond that, you have a lot of Indian players that are into the OTC, a lot of top Indian pharmaceutical companies which have entered into the OTC foray.
So competition is there in every area. The only difference between OTC and Rx, Rx, the distribution channel has consolidated tremendously, and that consolidation has affected competition and price erosion, which has taken place as a cascading impact of that, while OTC is still fragmented and diversified where that is concerned.
Second one last one. There's a -- it's on the U.K. market, it seems to have grown pretty well in H1. Has anything really changed in the market for us and given whatever is happening in the continent out there, what do you see outlook for our business in the next couple of years?
I think the outlook is only going to get stronger because of the product pipeline that we have and the nature of the products that are getting approved. So we are looking much more healthier, much more stronger. We're also penetrating into the market. We have become very prominent players over a period of time, consistent deliveries.
We have a much bigger product portfolio in the U.K. market as compared to the U.S. So we've got -- [indiscernible] be having over 100-plus market authorizations while bills has got about 60-odd market authorization. So much more diversified and wide product portfolio in the market -- in the U.K. market. And that has given us obviously an advantage to basically cater to a much more diversified portfolio as well as we are more consistent and preferred source of partnering with.
So we are seeing definitely a better market share. But all said and done, I do see -- I have a better visibility. I do believe there's a better visibility, better growth potential because of the product pipelines that are coming into that market in the next 12 months.
Next question comes from [indiscernible] de from CAO Capital.
Am I audible?
Yes, you're audible.
I missed probably 90% of what you have said because the line was just terrible. And I'm pretty sure it was from my end. So I'm very sorry if my questions are slightly repetitive. Sir, one thing is that this quarter, I was expecting some sort of a hit from -- on the FX side. So was there a hit? If not, then will we get a hit in the next quarter? How have you managed the cross currency risks? That's the first question.
This is Jitendra. So fortunately, of course, like the rupee has weakened like in the first half of this year, our revenue of course, 100% export-oriented. So we have a, of course, there is foreign only. There was no [indiscernible].
Okay. Okay. Sir, adjusted for that, what would have been the EBITDA margin? Any adjustments that you can provide?
Nothing very significant. I think there's a...
Not significant? Okay. Okay. Sir, next question is that we have been talking about margins going back above -- close to or above 20%. So given the pipeline and given the strength that you are seeing in the new filings, when can we expect that 20% margin for the entire portfolio for the company as a whole?
See, the guidance we had given earlier for this year was around 15% EBITDA margin. We are doing better now for the first half, it is at almost [ about 17% ]. So with the trend which we are seeing now in the input cost price reduction in the freight costs also has started coming down, so definitely, we expect to do better in this year. Hopefully, if this trend continues, we will see that number next year.
Sir, given the price from inside, because raw material prices are correcting, my guess is that some of the finished good prices will also come off, but then there are new launches which are happening. And there is a natural tendency of pharma products to lose some of their pricing rates. So if I look at the combination of everything, and I look at Q2 revenues of INR 453 crores, this portfolio, what you have today, what kind of growth are you expecting over the next 2 years? The current portfolio, I'm not talking about the new filings.
Yes. So basically -- go ahead, Jitendra.
No, you can do.
So we are trending -- obviously, this year, we are trending at INR 1,800 crore revenue, and we do believe this product portfolio will see us crossing INR 2,000 crores in the next year. We do plan to close our -- we plan to achieve what I have always committed in all our discussions in the previous con calls that we are moving in the path of crossing INR 2,000 crores in the next financial year.
And just to be like a repetitive here, but this is coming from the existing portfolio and existing -- this is like pure organic growth of the existing portfolio.
Yes.
Okay. Okay. And then the filings that you have, the OTC and the Rx filings, what kind of market potential do you see there? And how rapidly will they grow? So my guess is that anything you launched in U.K. will obviously grow very fast. Anything you launch in the OTC will grow very fast. But on the Rx side, what would be the ramp-up that we'll see in those?
So basically, after obviously, our first objective, our first milestone is INR 2,000 crores. But I've always maintained that the time -- now that we have got the platform, we've got a lot of product pipeline. I do believe we will -- after crossing that milestone of INR 2,000 crores, I think we should be moving towards probably the next milestone of INR 3,000 crores within 1/3 of the time that took us to jump from INR 1,000 crores to INR 2,000 crores.
Great. Great. Sir, final 2 questions. I did hear you were talking about your backward integration project. So can you please repeat what you said? And the last question would be that you were also looking at probably acquiring something on the front end in the EU markets. So any progress on that?
Well, just to address your backward integration, obviously, this has been a longer project than we had planned for, and we are planning to file a couple of DMFs in the mid of 2023. These are again molecules where we have captive consumption and where we are growing by strength. So we will be seeing -- obviously, after filing DMF, we still need to get it onto our licenses because they all ANDA products. So that takes about 6 to 9 months to get it. So hopefully, we are expecting by the end of 2023 or early 2024, we should see that profitability kick into the system, the cost advantage kicking into the system. And that's where we do see our margins also improving slightly from a cost efficiency point of view.
With regards to EU, we are still pursuing that part of it. We do plan to expand in other geographies. It's always been our aim. We are looking -- we are exploring different M&As. We have been in active dialogue over the last couple of 6 months and some dialogues are closer than the other. But nothing concrete to put pen to paper or nothing concrete, which is worth talking of because these are at very initial stages. But we will keep pursuing it, and we are hopeful that we will come across some M&As, which are -- which will add a tremendous value to the company and the shareholders.
So nothing imminent as such as of now.
Listen, in M&As, it can happen, it can happen within a couple of months, within a couple of months or maybe in a year's time. So it's difficult. But we are actively looking at it.
Sure. I get the point. Right. All right. Right. That's about it. I would really appreciate it, sir, whatever your opening remarks were, if they can be posted on the exchanges. It would be nice to go through whatever you have said. We couldn't hear anything. Congratulations for a very good quarter.
Next question comes from Manus Matthew Jacob, an individual investor.
Congratulations, Mark and Jitendra. My first problem was I couldn't connect to you because I had a problem with the line. In fact, this con call was the worst ever con call by DAM by the people who coordinated the con call. So my first question is the buyback over?
No. The buyback is still going on. We have completed about 50% plus of the buyback.
I know. I know. I know. But there has been no buyback for some time. I mean that's why I was asking when it's over.
No, it's not yet over.
Okay. Question number two, as you had said earlier, from your profit product portfolio, you will be doing INR 2,000 crores. Okay. But how would about with Teva coming in, would you be doubling this INR 2,000 crores?
Obviously -- well, so the -- I would like to say -- that's a very good question, actually. But Teva, basically, we have to work on expanding the capacity of what we're acquiring. So we do have -- we have projected a spend of nearly INR 200 crores into this project, which includes the acquisition cost and the CapEx. I do believe that once we achieve that objective, definitely, Teva would basically be doubling our present capacity, if not more, of what we presently have in our present plan. So with the new capacity of that magnitude and that volume will definitely give potential for growth, and that's where we are -- you have to invest today to see returns tomorrow. And that's where we do believe that with what Teva basically opens up, the potential -- what it opens up, we can definitely increase our revenue and reach the next milestone maybe INR 3,000 crores.
Okay. Okay. The next question is this just turnover of [ INR 452 crores ] has it come because of the ForEx benefit? Or has it come with driving volumes?
Sorry, I didn't get that.
The INR 452 crores you did this quarter, was it because of the ForEx depreciation, the rupee depreciation? Or was it because of the driving volumes?
It's a driving volumes. We have grown in terms of revenue in all the continents and all the geographies that we are in.
Okay. And the next question, Teva, from April 1, will belong to Marksans. So as of today's capacity, what volume do you expect from Teva as today's capacity?
From April, the Teva capacity is not very large. So it's probably 1.5 billion tablets maximum.
Okay. So I mean, in this quarter, it has grown?
No, no. 100 crores per quarter is not possible. I mean 1 -- I'm talking of 1 billion tablets, 1.5 billion tablets for the whole year. So that's not a very large volume, but we are going to increase it. We are going to increase it, and we are working on CapEx aggressively out there. So then obviously, we will achieve maybe 200 crores. Once we hit our objectives of increasing capacity, we'll probably achieve maybe 200 crores per quarter, if not more. Right now, the capacity is low, so we have to increase our capacity on that.
[Operator Instructions] We are having a follow-up question from Madhu from Capital Private Limited.
So what is the current status of input prices like supply cost under the input or on price? Is [indiscernible] seeing in the current quarter and the future of [indiscernible]?
So the freight cost has come down definitely from what it was historically high, and that is helping our bottom line which was actually eroding a lot of our bottom line. So I do see some better profitability in the coming quarters. But the input cost is slightly, I would not say, slightly improved. I mean it has cooled down from an upward trend. We are seeing it coming in a low -- in a downward trend, but it is at a very slow pace. So again, the global market scenarios are so volatile with the war still raging in Russia and Ukraine. No one has a crystal ball to see as to what impact it will have. Obviously, China has got its own challenges of lockdowns. So again, we are very cautious in terms of giving any forward-looking statement. But as on today, it is looking positive. It is improving to that level.
Okay. Sir, do we have any regulatory audit we lost concur to produce it?
I didn't get you. Could you repeat that?
Any regulatory audits in all the 3 sites between last 3, 4 months did we have?
Yes. No. But obviously, yes, we have not -- I mean, in the U.K., we have had audits, U.K. audits. Our U.K. plants have been audited. But out in India, audits can happen anytime. So it does not matter whether you've been audited or not audited. They can come any time.
Have we audited at the U.S. facility, sir?
I didn't get you. Could you repeat that?
No, we have 1 facility in the U.S. as well, right?
Yes, yes. So that gets audited very frequently, obviously, once a year, twice a year, but in U.S., it's different. They come in any time because it's a local audit.
So there are no clinical other business. We have 2 in both of them in all the [indiscernible] right as of now, right?
Again, U.S. audits can happen anytime. So I would -- you have to take note of that, that yes, as of today, we have our GMP status. We are working on it. There are no observations. And obviously, we work towards a brighter future tomorrow.
And the last one I think -- so we are well prepared now actually, we are launching our -- we are actually accelerating about the momentum into the regulated markets. The filings means it's a very good number for the size of merchant. I think the latest sector under the facilities and the filings, I think [indiscernible] be taken care and I think the properly keeper stores in terms of getting this rightly done.
Yes. Thank you. I mean I didn't get most of that. But yes, I mean, we are moving in the right direction because as a company, we are evolving, and we've reached a stage where visibility and growth is much more stronger and better out here.
Yes. Only 1 thing on processing side because of them, actually, we are accelerating this filing phase. So definitely, there will be certain regulatory issues may crop up. What I'm saying is that, so I think the leadership sectors are probably pleasing to see that nothing will be going more concerning. That is what I'm expecting from your teams.
Well, we are working hard to basically achieve all objectives.
Next question comes from Utsav from DAM Capital.
So I wanted to know about your plans in the Australia and ROW markets. So that's my first question.
So the Australian market, obviously, we had a bit of a challenge in terms of pricing pressure in terms of profitability part of it for the first time actually because of freight and because of the disruptions, supply chain disruptions. But we do believe that the Australian market will grow. We are seeing growth. We have evolved over the many years. It's a smaller market. Population is small.
So obviously, in terms of the absolute numbers, it will always remain small, but I do see a growth happening there. The -- I mean, the other emerging markets, I think we are doing fairly well. We do see us doubling our revenue in the next couple of years. So it is getting strong. We are expanding into different geographies, and our product portfolio is getting stronger. So we do see that adding value both in the top line as well as the bottom line. So I'm quite optimistic when that is concerned.
And my next question was around the distributor model in these markets. So where do you have a front-end presence? Do you have a front-end presence in any of these markets? Yes. So that's...
Obviously, Australia, we do have a front-end market. The rest of our emerging markets, presently, we do distributor market and marketing collaboration with the front end.
And lastly, sir, on your M&A plan. So you spoke about some M&A transactions in the call. So can you explain what kind of areas would you be looking for a market? And if you'd be looking at some vertical integration in other markets through M&A.? So if you could add some color on that.
Well, presently, in M&As, we are exploring. Obviously, we are exploring the Pan-Europe market. Now they will be obviously front-end market authorizations. Pretty much what we have in U.K., we are -- we'll be expanding into other geographies of Europe. But that said and done, that is right now on the horizon where we are pursuing. We are actively in discussions. We are talking to various companies, and that's a geography of interest for us right now.
Besides that, we don't have anything on our plate, any other geographies on the plate to discuss. But again, M&As are some things which sometimes opportunities come and then we have to explore it at that particular time.
And what would be the potential size of a deal? If you would be -- I mean, what's the potential target size?
It's difficult to say because we don't have a target right now in hand. So it's difficult to actually put a potential target. But again, we are looking for a platform to launch our products. We are looking for a platform where we can have distribution channels and where we can add value.
[Operator Instructions] We are having a follow-up question from [indiscernible].
So a couple of questions that you said the new Teva plant, you will be producing 1.5 billion units per annum. But if I look at the document, the existing capacity of that plant is around [ 6 billion ] and the total capacity [ 8 billion ]. So would it require us to ramp up that capacity? Or I mean, how should I look at it?
Yes. So basically, we are talking of 8 billion with the expanded -- expansion capacity that we are working on. So presently, their capacity volumes are low, and it will take us about 6 to 8 months after we get into the plant to actually achieve part of that objective. That's why we have given a 2-year window period for us to achieve that objective of touching 8 billion capacity.
Okay. And just a follow-up question on the API side. So how we would be funding those projects?
It will be through internal accruals.
We are having a follow-up question from Nitin Agarwal from DAM Capital.
Mark, just quickly on the Teva portfolio that we are talking about. For filling up the entire [ 8 billion ] target capacity, I mean, would you require a significant share of contribution from the newer set of products or the current set of products can take you to a significant distance there also?
So obviously, since our geographies and our product portfolios are increasing, our market share is increasing, we do need additional capacity. So I do believe this 8 billion will be more from an additional capacity requirement point of view. That is pretty much double than what we are presently doing with our present facility in Goa. So that will obviously generate that equivalent revenue spot. And that's where we are very optimistic after we cross the INR 2,000 crores, that's where if we produce more, we can sell more. And definitely, that will be a growth for the next milestone.
And in your assessment, by when do you start sort of closing optimal -- reach an optimal capacity utilization of the newer assets?
You're talking of a present plant?
No, the Teva plant, when do you hit the optimal capacity utilization on the assets after you -- how many years do you take you to utilize the optimal?
It will be happening [indiscernible]. So today, we do believe whatever we -- whatever capacity we do to activate or do start or whatever -- presently, they have a very small capacity. So that's where we are taking obviously 8 billion to scale up from 1.5 billion to 8 billion is not going to happen overnight. And -- but as and when we scale up, let's say, the first objective will be to get it up to 4 billion and then we'll do 8 billion. But by the time we touch 4 billion, we'll probably be sold out in terms of the capacity of 4 billion and then we'll be moving towards 8 billion. So I do believe that we won't be having -- we won't keep any spare capacity lying around.
And lastly, on your overall business mix, what will be at a global level, our share between OTC and prescription on an overall global level? And how do you [indiscernible]?
So we have -- I think OTC is about 65%. Rx is about 35%. Historically, it was 50-50 with OTC now becoming -- taking a little larger share of 65-35. Moving forward, I do believe it will remain that way, give or take a percentage point here and there, but I do believe it will probably remain in the will mix, maybe 65-35.
[Operator Instructions] We're having a follow-up question from Madhu G from Capital Private Limited.
In the OTC, we are having there 65% sir, from nearly 68%, what is our whole label share?
When you mean own label, are you talking of -- our control brand -- I mean, our control label or like bells or you're talking private label?
I'm talking about the e-commerce platform. I'm talking about that.
Our e-commerce platform is relatively very small because we've just launched it, not even a year. So -- but it is growing. So obviously, in terms of the overall business, it is relatively very small, maybe single digit.
In your presentation, I saw that actually, there is a store label and the whole label. So what is the store label, sir?
Our store label is what we supply to retail outlets. Own label is what we -- like you said, we do the e-commerce and a few of the retail outlets we promote our own brands.
The presentation was showing the price of issuing somewhere around [ 20%, 25% ] reduction. The pie chart was shown, that's why I'm asking this question, sir. The presentation that was uploaded to the BSE site that was showing that the 1 label somewhere close to 20% like that, the pie chart.
Yes. Yes. I mean, in U.K. -- so own labels, we also do Rx and our own labels, not only OTC. So we -- all our Rx is basically in own labels.
[Operator Instructions] Ladies and gentlemen, this concludes your conference for today. Thank you for your participation and for using Dusaba's conference call service. You may disconnect your lines, sir. Thank you, and have a pleasant evening.
Thank you. Bye-bye.